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Behavioral Strong Implementation

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Abstract

Choice behavior is rational if it is made in accordance with the maximization of some context-independent preference relation. This study re-examines the classical questions of implementation theory under complete information in a setting in which players' choices need not be rational and in which the game theoretic solution concept invoked is an extension of Aumann's (1959) notion of strong equilibrium beyond the rational domain. The proposed equilibrium notion incorporates a notion of Pareto optimality which refines, sometimes strictly, other extended notions of Pareto optimality proposed in the literature. In contrast to what happens when players' choices are rational, de Clippel's (2014) extension of Maskin monotonicity to non-rational domains is not a necessary condition for implementation in behavioral strong equilibria.

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  • T Hayashi & R Jain & V Korpela & M Lombardi, 2020. "Behavioral Strong Implementation," IEAS Working Paper : academic research 20-A002, Institute of Economics, Academia Sinica, Taipei, Taiwan.
    • Handle: RePEc:sin:wpaper:20-a002
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    Cited by:

    1. T. Hayashi & R. Jain & V. Korpela & M. Lombardi, 2023. "Behavioral strong implementation," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 76(4), pages 1257-1287, November.
    2. Guo, Huiyi & Yannelis, Nicholas C., 2022. "Robust coalitional implementation," Games and Economic Behavior, Elsevier, vol. 132(C), pages 553-575.
    3. Altun, Ozan Altuğ & Barlo, Mehmet & Dalkıran, Nuh Aygün, 2023. "Implementation with a sympathizer," Mathematical Social Sciences, Elsevier, vol. 121(C), pages 36-49.
    4. Mehmet Barlo & Nuh Aygün Dalkıran, 2022. "Computational implementation," Review of Economic Design, Springer;Society for Economic Design, vol. 26(4), pages 605-633, December.
    5. Barlo, Mehmet & Dalkıran, Nuh Aygün, 2023. "Behavioral implementation under incomplete information," Journal of Economic Theory, Elsevier, vol. 213(C).

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    More about this item

    Keywords

    : : Strong equilibrium; implementation; state-contingent choice rules; bounded rationality;
    All these keywords.

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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